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Sunday, August 22, 2010

Disappointing results for Fall textbook season

The fall textbook season at Xavier University is just about done. This year's numbers were 25% of last year's fall semester (that's a 25 index for those corporate types that talk like that). Of course my reaction to that was to say "time to move on to another idea, this one is dead." But that's not very entrepreneurial. Plus after reading about all this stuff about failure and how one should learn from it, I really should try to learn from this!

So I started coming up with hypotheses as to why this was happening:

Competition. First, it seems like textbooks are a hot topic nowadays. Tons of sites out there are trying to get student's attention. The latest one is Chegg, which is a textbook rental site. As an aside, back in '07 when I was conceiving NOTtheBookstore.com, I also had the idea of a textbook rental business. I chose this model because it required a lot less capital to work with. So maybe there was a lot of competition, and people weren't using my site to buy from Amazon or Half anymore.

New textbook info requirements. The government passed a law requiring a school to post required textbooks and prices at the time of registration.  Maybe this meant my site wasn't providing enough value for people to click through to, since one of the discerning features was it showed you what books you need. Now they already tell you!

Students now know to buy online. This was another value I thought the site brought, that is to tell people to buy online. When I started the site, I had no idea I could buy the same book for much cheaper online!

Finally, and I think this is probably the 80 for the 20 reason...

I didn't have any on-campus marketing presence, other than Facebook and newspaper ads. The Marketing Club and I took a break, and initially revenue was doing fine. So I concluded that it was self-sufficient. I'm thinking that conclusion has been disproven.

Some other supporting data... The drop in revenue corresponded to a drop in traffic. I haven't run the numbers yet, but by eyeballing it, it seems like the revenue per visit numbers are the same. So it's not that students came to the site and was disappointed in it. People who showed up bought something at the same rate. People also saved on average 50% off the bookstore price, which hasn't changed (in fact, I use that number in my ads). So it's not that book prices online have gone up either.

Conlcusions:

On campus marketing through the Marketing Club was essential. It's one thing to see something advertised on Facebook or in the school paper. It's another to have fellow students telling each other about it.

One opportunity for me is to put in a new "killer feature." Educating students on getting books online and having my site be their site isn't what it used to be. People already know about it. I need something to add value for the students to give them an incentive to use my site. I have some ideas, but not sure any of them are "killer." One is to provide a place for students to post tips for other students on whether the books are really needed, or cheapest places to buy the book.

Next action:

This is a no brainer. Get back in touch with the Marketing Club. I'd like to run a focus group and test some of these conclusions with them to see if I'm right.

Any thoughts? Suggestions?


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1 Comment:

madphoenix50 said...

It's kind of like any product launch. Without marketing support or updates to the product (new flavor, new claims, updated packaging), sales volumes inevitably decrease.

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